It's been said over and over by those who have a basic
understanding of money, investments, debt and, well, just basic math, that it
wouldn't be long before the rapid increase in government borrowing and debt
over the past year would catch up with us in terms of what that debt begins to
cost the country.

Last week, the Treasury Department saw trouble on the horizon when it
conducted the latest bond auction (which is a fancy way of saying
"attempting to borrow money from investors and/or other countries").

NEW YORK (AP) - Weak demand at a Treasury bond auction touched off
worries in the stock market Thursday about the government's ability to raise
funds to fight the recession.

The government had to pay
greater interest than expected in a sale of 30-year Treasurys. That is
worrisome to traders because it could signal that it will become harder for
Washington to finance
its ambitious economic recovery plans. The higher interest rates also could
push up costs for borrowing in areas like mortgages. ...

Of course you could just as easily replace the phrase
"fight the recession" with "finance more big government spending
that Obama plans".

The weak demand reflected waning safe-haven
buying, as well as concern that the Federal Reserve's aggressive efforts to
revitalize the economy by increasing money supply may lead to a spike in
inflation in the longer term....

Well, it got even better this week.
Just as with all other bonds that are sold on the open market, our government's
bonds are subject to being "rated" by companies that do that sort of
thing to give potential investors a clue as to how safe the bonds are, how
solid the financials of the bond issuer are, etc.. The problem? The
balance sheet of the United
States of America is a basket case - and
getting worse by virtue of the policies of the people in charge.

Long before the
current financial crisis, nearly two years ago, a little-noticed cloud darkened
the horizon for the US
government. It was ignored. But now that shadow, in the form of a warning from
a top credit rating agency that the nation risked losing its triple A rating if
it did not start putting its finances in order, is coming back to haunt
us.

That warning from Moody's focused on the exploding healthcare and
Social Security costs that threaten to engulf the federal government in debt
over coming decades. The facts show we're in even worse shape now, and there
are signs that confidence in America 's
ability to control its finances is eroding.

Prices have risen on
credit default insurance on US
government bonds, meaning it costs investors more to protect their investment
in Treasury bonds against default than before the crisis hit. It even, briefly,
cost more to buy protection on US
government debt than on debt issued by McDonald's. Another warning sign has
come from across the Pacific, where the Chinese premier and the head of the People's Bank of China have expressed concern about
America 's
longer-term credit worthiness and the value of the dollar.

As a result, our bonds are now running the risk of being
downgraded from the top "AAA" rating they've had since
1917. Which means investors will ultimately demand higher interest
rates in order to loan our government money...which means interest on our debt
eats up a larger part of our budget...which means, you guessed it, someone's
gonna' want to raise our taxes in the near future.